The claimants' online quiz games were marketed by an affiliate marketer using "ransomware" software which blocked the internet browsers of users in an attempt to force the user of the computer to subscribe to online services. The website in question invited users to pay to subscribe to the claimants' quiz games to unlock their browsers; even when this was done, the browser remained blocked.

As a result of consumer complaints, Phonepayplus took regulatory action against the claimants including a total suspension of their business in the UK from 24 June to 15 July 2013 (and a partial suspension thereafter until mid-August 2013), freezing about £350,000 of the claimants' revenue in the hands of third parties, and imposing penalties and administrative charges for breaches of the Code.

In proceedings in the High Court brought by the claimants, the court ruled that the actions of Phonepayplus were unlawful. The claim was transferred to the Queen's Bench Division for issues of causation and quantification of damages to be determined.

Following initial identification by Kaspersky Lab and using data provided by the internet security company, PhonepayPlus’ research team investigated the activities of Circle Marketing Ltd, Cloudspace Limited and Syncronized Ltd. PhonepayPlus found that malware which was contained in a number of apps, downloaded automatically without obtaining the users consent while they visited an adult website. Once downloaded to the phone, customers would be billed without knowledge via suppressed premium rate text messages.

In addition to the app, two of the providers, Cloudspace and Circle Marketing used marketing lists to contact consumers without their consent. A number of consumers also reported receiving explicit text messages through a WAP opt-in.

PhonepayPlus has recently collaborated with Ofcom and other regulators in order to produce advice for consumers in relation to mobile apps.

19/11/2013:
PhonepayPlus guidance on digital marketing and promotions
The regulator of Premium Rate Services, PhonepayPlus, has issued a General Guidance Note on Digital Marketing and Promotions. It says that a fifth of customer complaints relate to digital marketing. The primary areas of concern for providers to be aware of are:
* pricing information;
* misleading promotions;
* attracting consumers on false pretences;
* the right to privacy

07/11/2013:PhonepayPlus plans to make regular text donation to charities easier
PhonepayPlus has published a consultation document after analysing the outcome of a pilot held with payment intermediaries and charities testing new methods of allowing consumers to donate on a monthly subscription basis.